U.S. unemployment rate hits 5.1%, lowest in 7 years

Talk about a toss up. The state of U.S. jobs is pretty healthy. But the latest jobs report presented a mixed bag of news.

First the good: the U.S. unemployment rate fell to 5.1%, down by nearly half since the peak (10%) during the Great Recession.

While it was a healthy sign, August's job gains sent more of a mixed message.

The economy added 173,000 jobs in August. It was a decent gain in jobs for the month, but below the average monthly jobs gains -- 212,000 jobs -- so far this year.

The jobs number also fell below expectations. Economists surveyed by CNNMoney projected that the economy would add 207,000 jobs.

Wages grew 2.2% in August, a little better than expected but well below the 3.5% growth that the Federal Reserve would like to see. But wage growth has been missing during the U.S. economic recovery and any growth is an encouraging sign.

"The job market is still moving in the right direction," says Robin Anderson, senior economist at Principal Global Investors.

So far this year the economy has added nearly 1.7 million jobs, on pace to gain about 2 million jobs -- a healthy figure -- by the end of the year.

But the pace isn't wow-inducing. By this time last year, the economy had added 1.9 million jobs.

Still one positive sign for wage growth was that the economy added many high income jobs. Health care added 56,000 jobs and financial services gained 19,000 jobs. Professional service jobs, such as lawyers and accountants, grew by 33,000 in August.

While the report wasn't a clear victory, historically August's jobs gains have historically been revised upward.

"August always gets revised up," says Tom Gimbel, CEO of LaSalle Network, a recruiting firm. The economy "is in a very neutral place. It's not falling down and not jumping up."

The report is also likely to cloud the picture for the Federal Reserve's historic decision to raise its key interest rate, that is still on the table when members of the central bank meet in less than two weeks.

Fed officials have said they wanted to see key economic data like the jobs report before deciding on a rate hike. Although the U.S. economy has been good, this report is not a resounding victory for the American economy.

"You can't hike on a 173,000 number," says Phil Orlando, an economist at Federated Investors. "The Fed has to think long and hard about pushing this thing out to December."

Other experts think September is still on the table. Even before the August jobs report came out, Fed officials appeared split. A September rate hike still appears to be an open question.